United States District Court, W.D. Louisiana, Shreveport Division
SHANNON RULE, ET AL.
SOUTHERN INDUSTRIAL MECHANICAL MAINTENANCE CO., L.L.C., ET AL.
ELIZABETH E. FOOTE JUDGE.
L. HAYES UNITED STATES MAGISTRATE JUDGE.
the undersigned Magistrate Judge, on reference from the
District Court, is a motion for leave to file second amended
complaint [doc. # 122] filed by plaintiffs Shannon Rule and
Karina Esquivel, et al. The motion is opposed. For reasons
assigned below, the motion is granted-in-part and
October 7, 2016, Shannon Rule and Karina Esquivel filed the
instant collective action under the Fair Labor Standards Act
(“FLSA”), 29 U.S.C. §§ 201, et
seq., individually, and on behalf of all other
similarly-situated current and former employees of Southern
Industrial Mechanical Maintenance Company
(“SIMMCO”) for unpaid wages, overtime, liquidated
damages, attorney's fees, and costs. (Compl., ¶ 1).
Specifically, plaintiffs allege that they were hourly,
non-exempt employees entitled to overtime pay under the FLSA,
but that SIMMCO failed to include their per diem amounts in
their regular pay when calculating and paying overtime.
(Compl., ¶¶ 10-12). Plaintiffs contend that because
SIMMCO's per diem policy was tied to the amount of hours
worked and subject to reduction on an hourly basis, the per
diem must be included as a component of their regular rate of
pay for purposes of overtime. Id. (citing Newman
v. Advanced Tech. Innovation Corp., 749 F.3d 33, 38 (1st
December 30, 2016, plaintiffs filed a motion to conditionally
certify a collective action and to authorize notice to
prospective parties. [doc. # 12]. On March 6, 2017, the
undersigned recommended that the motion be granted, as
revised. (March 6, 2017, R&R [doc. # 22]). On April 24,
2017, the District Court adopted the report and
recommendation and conditionally certified the collective
action. (April 24, 2017, Order [doc. # 45]).
14, 2017, the court granted plaintiffs leave to amend their
complaint to join SIMMCO's officers/owners, David Blurton
and Ginger Blurton, as additional defendants. See
doc. #s 73, 84-85. On February 12, 2018, SIMMCO filed in the
record a suggestion of bankruptcy. [doc. # 108].
almost one year, plaintiffs and the Blurtons did nothing to
advance the case for trial until the District Court prompted
them by convening a January 7, 2019, status conference.
See doc. #s 109-110. At the conference, plaintiffs
reaffirmed their interest in pursuing their claims against
the Blurtons. Accordingly, on January 22, 2019, the
undersigned held a scheduling conference and issued a new
scheduling order. [doc. #s 112-114].
February 19, 2019 - more one and one-half years after joining
the Blurtons as defendants -- plaintiffs served each with
their initial interrogatories and requests for production.
(Interr. & Reqs. for Prod.; M/Compel, Exh. C). On March
21, 2019, the Blurtons responded to plaintiffs' discovery
requests. (Defs. Resps. to Interr. & Reqs. for Prod.;
M/Compel, Exh. D On May 7, 2019, plaintiffs filed the instant
motion for leave to amend their complaint to add the
following defendants: (i) former SIMMCO Project Manager David
Payne; (ii) former SIMMCO Human Resources Director Vanessa
Carrasco; (iii) former SIMMCO Superintendent Randy Sawdey;
(iv) former SIMMCO Safety Director Tom Pegram; (v)
“Southern Industrial Mechanical Maintenance Company II,
” or SIMMCO II, a successor company to SIMMCO; and (vi)
The Blurton Group, L.L.C., a joint employer of plaintiffs.
20, 2019, the Blurtons filed their opposition to
plaintiffs' motion, in which they argued that the
proposed amendment was untimely and futile. [doc. # 133].
Plaintiffs filed their reply brief on May 24, 2019. [doc. #
138]. Thus, the matter is ripe.
of the Federal Rules of Civil Procedure provides that leave
to amend shall be “freely” granted “when
justice so requires.” Fed.R.Civ.P. 15(a)(2). However,
where, as here, amendment is sought after expiration of a
court's scheduling order deadline, Rule 15(a)'s
liberal standard is inapplicable unless, and until the party
seeking leave first satisfies the more demanding requirements
of Rule 16(b). See Fahim v. Marriott Hotel Services,
Inc., 551 F.3d 344, 348 (5th Cir. 2008)
Rule 16(b), “a schedule may be modified only for good
cause and with the judge's consent.” Fed.R.Civ.P.
16(b)(4). To obtain an extension of a scheduling deadline,
the requesting party must demonstrate that, despite its
diligence, it cannot reasonably meet the deadline. Fahim,
supra (citations omitted). The four factors relevant to
good cause include, (1) the explanation for the failure to
timely move for leave to amend; (2) the importance of the
amendment; (3) potential prejudice in allowing the amendment;
and (4) the availability of a continuance to cure such
prejudice.” Id. (citations and internal
quotation marks omitted). The court considers each factor, in
Explanation for Failure to Timely Seek Leave to
attribute the timing of this motion to the fact that they did
not uncover requisite facts to support FLSA claims against
the individual defendants until the Blurtons served them with
their supplemental discovery responses on May 1, 2019.
See M/Leave to Amend, Exh. D. The Blurtons contend
that the individual defendants were disclosed as potential
witnesses in this case as early as January 2017, in
connection with SIMMCO's initial disclosures.
Furthermore, on January 9, 2017, in its responses to
plaintiffs' first set of discovery, SIMMCO identified
Randy Sawdey, David Payne, and Tom Pegram as individuals who
supervised plaintiffs. (Defs. Opp., Exh. 1). At that time,
SIMMCO also identified Vanessa Carrasco as the person who
entered the underlying data for calculating overtime.
Id. However, SIMMCO limited its discovery responses
to the two original plaintiffs, and expressly excluded
persons who might later consent to participate in a
collective action, if certified. Id. The Blurtons
further argue that plaintiffs themselves should have known
who their supervisors were from the suit's inception.
court observes that under the FLSA, an “[e]mployer
includes any person acting directly or indirectly in the
interest of an employer in relation to an employee.” 29
U.S.C. § 203(d) (internal quotation marks omitted). The
Fifth Circuit uses the “economic reality” test to
assess whether there is an employer/employee relationship.
Gray v. Powers, 673 F.3d 352, 354-55 (5th Cir.2012)
(citations omitted). In order to resolve whether an
individual or entity is an employer, the court must consider
whether the alleged employer: “(1) possessed the power
to hire and fire the employees, (2) supervised and controlled
employee work schedules or conditions of employment, (3)
determined the rate and method of payment, and (4) maintained
employment records.” Id. (citation omitted).
In cases involving more than one potential employer, the
court “must apply the economic realities test to each
individual or entity alleged to be an employer and each must
satisfy the four part test.” Id. (citation
court is not persuaded that the plaintiffs in this collective
action would have had personal knowledge as to all of the
foregoing factors for the prospective defendants. Moreover,
the court accepts plaintiffs' explanation that they did
not obtain additional information to support their claims
against the individual information until the Blurtons
supplemented their discovery responses on May 1. In fact, the
Blurtons contend that plaintiffs still do not allege
sufficient facts to assert plausible claims against the
individual defendants. See discussion,
not emphasized by plaintiffs, the need to join additional
prospective employers beyond SIMMCO and the Blurtons did not
crystallize until after SIMMCO filed for bankruptcy, and then
earlier this year, when the Blurtons intimated that they did
not have money or assets to satisfy a judgment against them.
See Email Correspondence; M/Extend Disc. Deadlines,
Exh. A. Regardless, plaintiffs promptly filed the instant
motion within days after receipt of the supplemental
The Blurton Group
Blurtons argue that plaintiffs could have joined the Blurton
Group within the original deadline to amend pleadings because
SIMMCO's website consistently documented that SIMMCO was
a division of the Blurton Group. Again, however, the need to
join the Blurton Group did not crystalize until only a few
months ago. See discussion, supra.
Moreover, the court appreciates plaintiffs' decision to
consolidate its joinder of parties into one motion, which did
not ripen until after receipt of supplemental discovery
responses regarding the individual defendants.
assert that SIMMCO II was not formed until October 1, 2018.
See M/Leave to Amend, Exh. C. The Blurtons
apparently contend that plaintiffs should have sought leave
to amend to join SIMMCO II before now. Of course, neither
side did anything in this case after SIMMCO's bankruptcy
filing until prompted by the District Court in January ...